Tag Archives: Mike Percy

It has been a busy week in Alberta politics and here are a few of my thoughts on some recent developments:

Blue Ribbon Panel on Alberta’s Finances

Premier Jason Kenney and Finance Minister Travis Toews appointed a “Blue Ribbon Panel on Alberta’s Finances” with a mandate to recommend changes limited to Alberta government spending. As others have already pointed out, the narrow mandate is a missed opportunity to actually address the fiscal challenges facing Alberta, which includes issues with revenue ranging from low taxation and over-dependence on oil and gas royalty revenues.

That Kenney, who started his political career as spokesperson for the Canadian Taxpayers Federation, would want to focus purely on spending is not a shock. But it is only part of the challenge facing Alberta.

Appointing an arms-length panel to make these recommendations is politically smart and will give cover to a United Conservative Party government that is already inclined to make significant cuts to funding of public services. The NDP made similar political moves when they appointed arms-length panels to recommend changes to the natural resource royalty structure and to recommend action on climate change, which included the creation of the carbon tax, which Kenney has pledged to repeal.

Kenney’s appointment of history professor and former Saskatchewan New Democratic Party cabinet minister Janice MacKinnon and former Alberta Liberal MLA Mike Percy was a clever move that on the surface mildly disarms its critics. But despite their past political affiliations, both MacKinnon and Percy have in the decades since they left elected office been welcomed in conservative circles because of their fiscally conservative views. MacKinnon was even prominently quoted in the UCP election platform.

Albertans need leaders who will look at the big picture, not just a slice of the problem. Judging by its narrow mandate, it is hard to imagine the blue ribboned panelists recommending anything but cuts, cuts, and more cuts.

NDP critics to be named next week

The 24 Alberta NDP MLAs who will make up the Official Opposition will be sworn-in on May 13 at the Legislative Assembly. Unlike their UCP colleagues, who will be sworn-in before the Speech from the Throne on May 21, the two dozen NDP MLAs will have an 8-day jump start with access to their Legislative offices and time to prepare for their first week of Question Period. And with a caucus mostly hailing from Edmonton, NDP MLAs will have a hometown advantage of not having to regularly travel long-distances to work in the capital city.

The NDP critic line-up is expected to be announced shortly after NDP MLAs are sworn-in. With 9 cabinet minister in its ranks, the NDP opposition will be well-equipped to question the cabinet of mostly rookie UCP MLAs. There could be a natural temptation to appoint the former cabinet ministers as critics for the ministerial offices they previously held, but it could also compromise the credibility of those critics who in some cases would be watching much of their 4-years of work be dismantled by the UCP.

The NDP will be tempted to continue their relentless campaign against the UCP on social issues, but treating the post-election period as just an extension of the 2019 election could be a strategic mistake. The NDP need to prepare themselves for how to respond effectively to the aggressive legislative agenda Kenney is expected to implement in the “Summer of Repeal” and to a fall provincial budget that could include deep and short-sighted budget cuts.

auf Wiedersehen, Derek.

Former Wildrose Party and UCP MLA Derek Fildebrandt resigned as leader of the Freedom Conservative Party last week after his party’s electoral poor showing and his failure to win re-election in Chestermere-Strathmore in the April 2019 election. Fildebrandt, also a former spokesperson for the Canadian Taxpayers Federation, is succeeded by interim leader David White, a former paramedic who ran for the party in Maskwacis-Wetaskiwin.

Say what you want about his political views and personalbehavior, but Fildebrandt has been one of the most consistently colourful characters in Alberta politics since he burst on to the provincial scene in 2012.

The Freedom Conservative Party is the latest name of a tiny right-wing populist and sometimes separatist party that has existed since 1999. It took its latest form in June 2018 when theWestern Freedom Party was renamed the Freedom Conservative Party. The party was originally formed as the Alberta First Party in 1999, renamed the Separation Party of Alberta in 2004 and again renamed the Alberta First Party in 2013 before it became the Western Freedom Party in April 2018.

“Rat-free, PST-free and Liberal-free” has been a Conservative mantra in Alberta since the reign of Pierre Elliott Trudeau. But is this trifecta now in jeopardy?

The decline of government revenues caused by the drop in the price of oil has once again sparked the discussion around resource diversification and tax increases in Alberta. And with talk of economic doom and gloom, Premier Jim Prentice is managing expectations and preparing Albertans for the upcoming provincial budget and likely a Spring provincial election.

Jim Prentice

Will the budget include deep funding cuts or tax increases? Under most circumstances, deep budget cuts would be the natural choice for the long-governing Progressive Conservatives, but there is growing speculation that Mr. Prentice could be softening the ground for the introduction of a Provincial Sales Tax (PST) in Alberta.

At a 2013 provincial fiscal summit, economist Bob Ascah suggested that a 1 per cent sales tax could raise $750 million in annual revenue for the provincial government. Diversifying income sources with a five or six per cent sales tax could help soften the blow of the dreaded $7 billion gap that Mr. Prentice has warned will face the provincial budget if oil prices do not increase by next year.

Late last year, Mr. Prentice declared in a speech to the Calgary Chamber of Commerce that he would not consider introducing a PST, but the Premier has changed his tune in 2015, saying that everything is on the table.

In the aftermath of the last major economic downturn in June 2008, when the price of oil dropped from a high of $145 per barrel in July to a low of $30 per barrel in December 2008, PC cabinet ministers like Doug Griffithsopenly mused about PST. When prices increased, resource royalties once again poured in provincial coffers and Alberta’s political class moved away from the PST discussion.

Facing a decline in the price of oil in 1984, Premier Peter Lougheed publicly mused about introducing a sales tax, but did not act on it.

The Alberta Taxpayer Protection Act, introduced by Premier Ralph Klein in 1995, states that a referendum must be held before a Provincial Sales Tax can be introduced. The PCs have shown in the past that they have no problem sweeping away old laws like this one. In 2009, the PC government amended their much touted Fiscal Responsibility Act which prohibited deficit budgets in order to pass a deficit budget.

Relying on a boom-bust economy, a real lack of long-term financial planning has been the biggest weakness of the 43-year governing PC Party.

Ted Morton

The introduction of a PST would be a bold and courageous move – one that could land Mr. Prentice in Alberta’s history books beside statesmen like Mr. Lougheed and Ernest Manning. And while under normal circumstances this would be a kiss of death to a Premier’s political career, we may now be witnessing a once in a lifetime opportunity to introduce a sales tax.

The Wildrose Opposition is both leaderless and in complete disarray, and the opposition New Democrats and Liberals could have a difficult time protesting a move that could majorly diversify the government’s revenue stream. And with the departure of Derek Fildebrandt late last year, the local Tax Outrage Industry is lacking a major spokesperson.

As reported on David Climenhaga‘s blog, Conference Board of Canada chief economist Glen Hodgson also weighed in on Alberta’s tax dilemma: “Not having a provincial consumption or sales tax is highly popular and has been great politics, but it denies the provincial government a steady and stable source of revenue through the business cycle.”

To get a grasp of how embarrassingly low our tax rates current are in Alberta, Kevin Taft in his 2012 book, Follow the Money, says that Alberta could increase its tax rates by $11 billion and would still have the lowest tax rate in Canada.

Critics will argue that a sales tax would unfairly penalize low income Albertans, and they are right. The government should also scrap the short-sighted flat tax and return to a real progressive income tax system. Alberta is currently the only province with a Flat Tax, the odd-ball brain child of former Treasurer Stockwell Day.

While Albertans look with envy at Norway’s $900 billion petroleum fund, it could be decades before our government imposes meaningful increases in natural resource royalties. The PCs bowed to political pressure from the oil and gas industry and paid a significant political price when trying to implement meaningful increases to resource revenues in the late 2000s.

The strongest opposition to the introduction of a PST may come from inside the PC caucus. Many PC MLAs are said to be unconvinced that Albertans would support a PST, and the presence of 11 anti-tax former Wildrose MLAs in the government caucus could stiffen the opposition from within. Skeptical MLAs would probably be correct that they will receive a blowback from Albertans in the short-term, but the right decisions are not necessarily the most popular when they are initially implemented. And without a credible government-in-waiting, now could be the the only time the PCs could implement a PST.

Alberta should strive to remain rat-free forever, but on the revenue front, we need to break our dependency on resource revenues that cripple our provincial government each time there is a hiccup in the market.

A short few months ago, it almost felt inevitable that the Wildrose Party would sweep into a majority government at the next election. Their support in the polls was skyrocketing and the 43-year governing Progressive Conservatives looked corrupt, broken and battered. But over the past few weeks, it appears the Official Opposition is stumbling into disarray.

Leader Danielle Smith’s plans to reenergize her party after its four recent by-election loses were sabotaged by social conservative party activists who rallied to reject a motion in support of equality at the party’s recent annual meeting. The defeated motion would have pledged the Wildrose to defend the rights of all people, “regardless of race, religious belief, colour, gender, physical disability, mental disability, age, ancestry, place of origin, marital status, source of income, family status or sexual orientation of that person or class of persons.” The vote has cast a shadow over the party.

After spending two years trying to distance herself from the “Lake of Fire” comments that cost the Wildrose its chance of winning the last election, it appears that Ms. Smith is back to square one.

Chris Bataluk

The defeat of the motion led Terrence Lo, the party’s vice-president in Calgary-Glenmore, to publicly resign.

“This vote confirmed to me that the misguided angry beliefs of a minority of the rank and file holds actual sway in party policy,” Mr. Lo wrote on his blog.

Lawyer Chris Bataluk, who ran for the Wildrose in Edmonton-Decore in the 2012 election, posted a stinging critique of his now former party on Facebook today.

“At this point I feel that the Wildrose Party was a noble but failed experiment,” Mr. Bataluk wrote. “It is of little joy to participate in a party that allows itself to be branded as the party of backward homophobes.”

Mr. Bataluk also noted that he did not renewed his party membership when it expired in August 2014.

The opposition party’s sudden turn is an important reminder of how quickly a party, or a leader’s, political fortunes can turn from good to worse.

Ms. Smith still has time to turn her party’s fortunes around, but the Wildrose Party is increasingly beginning to look like a flash in the pan. The party has a dedicated base of supporters and has shown its ability to raise significant amounts of money, but it now struggles to find relevance in a post-Alison Redford political environment. Can the Wildrose Party be more than a protest party?

Joe Anglin

While PC Premier Jim Prentice is still surrounded by many of the MLAs and party activists who stood loyally with Ms. Redford until her spectacular end, he has skillfully distanced himself from his predecessor’s legacy. The PC Party is once again masterfully attempting to reinvent itself in the image of its new leader.

After 43 years in power, it seems that anytime an opposition party gets close to defeating the PCs, they soon get knocked out. Not long after Laurence Decore led the Liberal Party to near victory in 1993, infighting and floor crossing destroyed any opportunity of a second chance at unseating the PCs.

Perhaps a sign of the PC Party’s versatility are two key players from Mr. Decore’s 1993 surge who now sit comfortably in the government ranks. Former Liberal MLA Mike Percy is now Mr. Prentice’s Chief of Staff and Gene Zwozdesky, first elected as a Liberal MLA, is now a PC MLA and the Speaker of the Assembly.

Those disenchanted Tories took a big political risk when they stepped out of line with Alberta’s Natural Governing Party to help start the Wildrose. The dangerous question for Ms. Smith is whether they are beginning to regret making that choice?

The opinions expressed on this blog represent my own and not those of my employer or any organization I may be affiliated with.

In addition, my thoughts and opinions change from time to time. I consider this a necessary consequence of having an open mind. This blog is intended to provide a semi-permanent point in time snapshot and manifestation of the various ideas running around my brain, and as such any thoughts and opinions expressed within out-of-date posts may not the same, nor even similar, to those I may hold today.